COTTON
General Comments: Futures were lower Friday on follow through selling from less than expected export sales reported Thursday by USDA. News that India and China would sell into local markets from government supplies in an effort to keep prices down on Tuesday had its effect as well. The market has already rallied a lot and now seems to be correcting lower. A sideways to lower trade could develop until the end of the month and the USDA planting intentions reports. Demand ideas remain strong overall based on the strong export paces seen in the USDA reports in recent weeks and on reports of tight domestic and world cash markets. Demand is still said to be strong, and sales for export have held up well given the price strength in recent weeks. Some producers in the Delta are noting the recent price rally and might decide to plant more Cotton this year. The plantings intentions report will be released at the end of the week. Weekend weather features rains in the Delta and Southeast and just some light precipitation in Texas. It was cold, but not too cold to hurt anything.
Overnight News: The Delta and Southeast will see mostly dry weather until a few showers appear about Friday. Temperatures will average below normal. Texas will get dry weather. Temperatures will average near to below normal. The USDA spot price is now 82.24 ct/lb. ICE said that certified Cotton stocks are now 0.427 million bales, from 0.424 million yesterday. Informa estimated US Cotton planted area at 10.367 million acres.
Chart Trends: Trends in Cotton are mixed to down with objectives of 82.00, 78.85, and 74.95 May. Support is at 86.20, 85.60, and 85.20 May, with resistance of 89.10, 89.80, and 90.45 May.
FCOJ
General Comments: Futures closed a little higher on forecasts from NOAA for a drier than normal Spring and Summer and on ideas of continuing crop losses from Greening Disease. It was mostly a consolidation trade on Friday. Forecasts calling for colder temperatures through the end of the month provided some buying interest. Temperatures are warm in the state, and conditions are dry, and talk about the potential for more fruit drop and poor development of the crop for next year continues. The temperatures should turn cooler this weekend and should stay cooler all of next week, but some rain could come with the cooler temperatures. Harvest in Florida of mid and early oranges is almost over, and the Valencia harvest is underway. Bloom has been reported in groves in all production areas of the state. Brazil is seeing near to above normal temperatures and scattered showers. ICE said that 1,014 notices were posted against March contracts and that total deliveries for the month are 1,014 contracts.
Overnight News: Florida weather forecasts call for mostly dry conditions. Temperatures will average below normal. USDA said that FCOJ in Cold Storage is now 0.976 billion pounds.
Chart Trends: Trends in FCOJ are mixed. Support is at 134.00, 132.00, and 124.00 May, with resistance at 140.00, 141.00, and 144.00 May.
Next page: Coffee, Sugar and Cocoa
General Comments: Futures were higher Friday in New York and Sao Paulo, but lower in London. Ideas that Arabica prices are now competitive to Robusta helped. London prices were also lower on reports of beneficial rains in Vietnam. Brazil producers remain on the sidelines waiting for higher prices and government support programs. Talk of a big offseason crop coming this year in Brazil kept ideas that there will be a lot of Coffee for buyers around. Brazil has Coffee to sell, but production in other countries is more problematical. Brazil producers are holding crops for now and are waiting for higher pridces before selling, or elase some government support via a marketing program. Reports of rust in Central America and the production cuts that it are still in the press. Current crop development is still good this year in Brazil, and production areas are getting drier weather for the developing crop, although there are a few showers around. There is some talk the drier weather could stress trees. Production ideas remain big there. Central America crops are mostly harvested. Colombia is reported to have good conditions.
Overnight News: Certified stocks are higher today and are about 2.747 million bags. The ICO composite price is now 129.30 ct/lb. Brazil should get scattered showers through Wednesday, then drier weather. Temperatures will average near to above normal. Colombia should get a few showers, and Central America and Mexico should get mostly dry conditions. Temperatures should average near to above normal.
Chart Trends: Trends in New York are mixed to down with objectives of 125.00 and 108.00 May. Support is at 134.00, 131.00, and 128.00 May, and resistance is at 138.00, 140.00, and 141.00 May. Trends in London are mixed to down with objectives of 2120, 2070, and 2020 May. Support is at 2130, 2115, and 2100 May, and resistance is at 2140, 2190, and 2220 May. Trends in Sao Paulo are down with objectives of 161.00 May. Support is at 165.00, 162.00, and 159.00 September, and resistance is at 173.00, 177.00, and 180.00 September.
SUGAR
General Comments: Futures closed a little lower on reports that the threatened port strike in Brazil had been cancelled. The congestion in ports has interrupted Sugar shipments as well as grains and oilseeds shipments, but now a major potential roadblock in exports has been reduced or removed. News of less Chinese imports in February hurt the price action as well. The market seems caught in a range between 1800 and 1900 basis New York May. Futures seem to uncover new consumptive demand every time the market moves below 1800 in New York and plenty of offers when a rally is made. Reports indicate that Brazil will start harvesting next month and that a big offer is expected. Brazil will start to offer a little less as mills there prepare for greater domestic Ethanol demand as blends for cars have been changed by the government. Reports from Brazil say that the new crop production looks to be strong, so the diversion into more domestic ethanol use will help offset increased sugarcane production. Exports from Brazil continue to be very strong overall despite the port problems. Overnight News: Scattered showers are expected in Brazil therough Wednesday, then drier weather is likely.
Chart Trends: Trends in New York are down with objectives of 1810, 1750, and 1700 May. Support is at 1815, 1790, and 1780 May, and resistance is at 1850, 1865, and 1875 May. Trends in London are mixed to down with objectives of 522.00 and 507.00 May. Support is at 525.00, 523.00, and 518.00 May, and resistance is at 533.00, 536.00, and 540.00 May.
COCOA
General Comments: Futures closed a little lower in consolidation tading. Ideas that production in the coming year will be short helped the bulls. The market is trying to mount a seasonal rally now that the main harvest is over in Western Africa. Ideas are that current low prices should créate new demand and that the main crop harvest is over in Western Africa and much of Asia so that supplies on offer could also be less. The weather is forecast to be warm and somewhat wet in West Africa this week. For now, traders expect good mid crop production from West Africa. Malaysia and Indonesia crops appear to be in good condition and weather is called favorable. Traders are starting to look ahead and past the midcrop harvest and note that the market could move to a production déficit next year. More buying is being noted in deferred months at this time due to smaller production ideas for the coming crops.
Overnight News: Scattered showers are expected in West Africa. Temperatures will average mostly above normal. Malaysia and Indonesia should see episodes of isolated showers. Temperatures should average near normal. Brazil will get mostly dry conditions and warm temperatures. ICE certified stocks are higher today at 4.437 million bags.
Chart Trends: Trends in New York are mixed to up with objectives of 2240 and 2370 May. Support is at 2150, 2110, and 2075 May, with resistance at 2190, 2220, and 2250 May. Trends in London are mixed. Support is at 1440, 1420, and 1405 May, with resistance at 1475, 1495, and 1510 May.
